WTF on Friday Markets, 17.11
Being cautious during euphoria
Disclaimer: Technical analysis is a way of analyzing the financial market based on statistical patterns. Drawing lines on the chart itself does not predict price movements, but only helps the analyst to visualize the results of different types of analysis (macroeconomical, fundamental, technical, etc.). The analysis is not a financial recommendation, although it can be used to make trading decisions. Current analysis may become irrelevant if market conditions change dramatically. Good analysis does not always lead to good trading decisions, and vice versa.
Macro
The outgoing week was marked by positive data on US inflation, which shows a steady decline and gives no reason to hike the rate any further. In addition, we received confirmation that BlackRock has indeed applied for approval of the Ethereum ETF. In terms of the up-trend continuation, this is bad news as capital flows will be split between Bitcoin and Ethereum, and we no longer have one locomotive to drive the market forward.
The markets have been euphoric for almost a month now. Bitcoin price has touched $38k twice, and many altcoins have multiplied several times. Solana’s price, for example, has multiplied three times, and we have accompanied this movement in almost every Friday report for almost two months. Now, bears are defeated, and their voices can barely be heard. Apparently, local peaks have either already been reached or will be reached soon; it is time to chill and wait for correction.
BTC
The chart looks more bearish than it did a week ago. Yesterday’s daily candle completely absorbed Wednesday’s upward movement. Now, the weekly candle is trying to close below the previous one. Apparently, we are on the verge of a deep correction all the way down to 32k (but no guarantees). Anything above 32k does not prevent the uptrend from continuing, so we can try catching a correction up to these values.
Notice: We have moved key resistance higher due to strong price action; now 30k won’t matter if price consolidates below $32k.
ETH
Ether’s chart looks much worse than Bitcoin’s chart. If BTC has a corrective backup and the chart on the large timeframes still looks good, ETH is right above its current key support at $1930. The ETF news only gave a few percent upside, suggesting the fundamental weakness of the asset. The ETH/BTC chart demonstrates this weakness.
DOGE
This is one of the few charts that looks good. This is primarily due to the hype surrounding the upcoming launch of the Doge-1 space marketing campaign. Nevertheless, the price certainly won’t hold in case of a strong Bitcoin correction. But $DOGE is a good candidate for the next run-up.
